All cryptocurrency exchanges in South Korea except the largest four may be unable to meet the bank account requirements needed to stay in business. A number of Korean crypto exchanges are considering suing the government and financial authorities, claiming that the country’s crypto law is unconstitutional.
- A number of exchanges are currently considering filing a lawsuit against the government and the financial authorities alleging the country’s crypto law is unconstitutional, Business Korea reported Monday.
- The revised Act on Reporting and Use of Certain Financial Transaction Information requires cryptocurrency exchanges to submit a document by Sept. 24 showing that they have a real-name account issued by a bank.
- However, banks in South Korea are reluctant to provide a real-name service to cryptocurrency exchanges due to money-laundering concerns.
- Several banks, including NH Bank and Shinhan Bank, are conducting risk assessments on the country’s largest cryptocurrency exchanges: Upbit, Bithumb, Coinone, and Korbit.
- However, no banks are willing to work with smaller crypto exchanges. Therefore, a large number of exchanges are expected to be forced to shut down.
- One exchange told the publication:
These days, banks are refusing to initiate their cryptocurrency exchange verification processes without clear reasons and most exchanges are failing to get a chance to prove themselves. The Financial Services Commission needs to step in right away.
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